Friday, May 27, 2011

The World Monetary Unit

Wax On, wax off.

Krugman today rambles on about a “Trilemma” in which “you can’t simultaneously have free movement of capital, a stable exchange rate and independent monetary policy”.  I suggest he has once again misdirected the issue.  For example, he states “And this [trilemma] creates a problem for emerging markets.  They don’t want their currencies to rise sharply; Brazil, for example, is not at all happy about this.  But not letting a currency rise would be inflationary - that is, Brazil doesn’t want to give up on its independent monetary policy.”

Now, I generally assume that Krugman is a shill for the neoliberal agenda.  He has long backed the general assumptions of the FED and his buddy Bernanke.  He misdirects the discussion through the statement about independent monetary policy.

Since when does Brazil, or any other country that is seriously engaged with international trade, have any independence?  The world is global and trade benefits the masters of the neoliberal agenda.  I’d agree if he mentioned North Korea that has independent policy due to its isolationist policies.

What Brazil and many other countries want is to get out from underneath what they view is the tyranny of the US dollar.  They want status quo change; all Krugman does is defend the status quo.  Brazil and several other nations are seeking a new currency, one in which they have more say in the world.  They want a redistribution of power.  Why can’t Krugman just say this?  I assume he knows it.

We are in the midst of a currency war.  The actions of the FED are debasing the US$ in some convoluted effort to protect the oligarik class.  In the end, they will fail because these people really don’t care about America.  They think they are above and apart from it and other nations; they think they are the puppet masters pulling the strings, if you will.  It is an illusion that someday will be revealed for the silliness that it is, just like the Wizard of Oz.

In the end we will have a new world currency.  One that is tied to precious metals, although I think some base metals should also be included.  Iron needs more love.

The new currency name could be the “World Monetary Unit” or WU.  I briefly considered WMD and the word ‘dollar’ but I suspect that that word will be despised when this all comes about.  The irony about mass destruction, as in the destruction of many currencies, is also all too clear. 

Risk on, risk off.

Disclosure:  long silver

No comments:

Post a Comment